---
kind: "section"
citation: "42 U.S.C. § 18031"
title: "42"
title_heading: "The Public Health and Welfare"
number: "18031"
heading: "Affordable choices of health benefit plans"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/18031"
units:
  - "Chapter 157 — Quality, Affordable Health Care for All Americans"
  - "Subchapter III — Available Coverage Choices for All Americans"
  - "Part B — Consumer Choices and Insurance Competition Through Health Benefit Exchanges"
---

# §18031. Affordable choices of health benefit plans

- (a) **Assistance to States to establish American Health Benefit Exchanges—**
  - (1) **Planning and establishment grants—** There shall be appropriated to the [Secretary](/usc/42/18024.md?p=c), out of any moneys in the Treasury not otherwise appropriated, an amount necessary to enable the [Secretary](/usc/42/18024.md?p=c) to make awards, not later than 1 year after March 23, 2010, to [States](/usc/42/18024.md?p=d) in the amount specified in [paragraph (2)](#a-2) for the uses described in [paragraph (3)](#a-3).
  - (2) **Amount specified—** For each fiscal year, the [Secretary](/usc/42/18024.md?p=c) shall determine the total amount that the [Secretary](/usc/42/18024.md?p=c) will make available to each [State](/usc/42/18024.md?p=d) for grants under this subsection.
  - (3) **Use of funds—** A [State](/usc/42/18024.md?p=d) shall use amounts awarded under this subsection for activities (including planning activities) related to establishing an American Health Benefit Exchange, as described in [subsection (b)](#b).
  - (4) **Renewability of grant—**
    - (A) **In general—** Subject to [subsection (d)(4)](#d-4), the [Secretary](/usc/42/18024.md?p=c) may renew a grant awarded under [paragraph (1)](#a-1) if the [State](/usc/42/18024.md?p=d) recipient of such grant—
      - (i) is making progress, as determined by the [Secretary](/usc/42/18024.md?p=c), toward—
        - (I) establishing an Exchange; and
        - (II) implementing the reforms described in subtitles A and C (and the amendments made by such subtitles); and
      - (ii) is meeting such other benchmarks as the [Secretary](/usc/42/18024.md?p=c) may establish.
    - (B) **Limitation—** No grant shall be awarded under this subsection after January 1, 2015.
  - (5) **Technical assistance to facilitate participation in SHOP Exchanges—** The [Secretary](/usc/42/18024.md?p=c) shall provide technical assistance to [States](/usc/42/18024.md?p=d) to facilitate the participation of qualified small businesses in such [States](/usc/42/18024.md?p=d) in SHOP Exchanges.
- (b) **American Health Benefit Exchanges—**
  - (1) **In general—** Each [State](/usc/42/18024.md?p=d) shall, not later than January 1, 2014, establish an American Health Benefit Exchange (referred to in this title[^1] as an “Exchange”) for the [State](/usc/42/18024.md?p=d) that—
    - (A) facilitates the purchase of [qualified health plans](/usc/42/18021.md?p=a-1);
    - (B) provides for the establishment of a Small Business Health Options Program (in this title[^1] referred to as a “SHOP Exchange”) that is designed to assist qualified employers in the [State](/usc/42/18024.md?p=d) who are [small employers](/usc/42/18024.md?p=b-2) in facilitating the enrollment of their employees in [qualified health plans](/usc/42/18021.md?p=a-1) offered in the [small group market](/usc/42/18024.md?p=a-3) in the [State](/usc/42/18024.md?p=d); and
    - (C) meets the requirements of [subsection (d)](#d).
  - (2) **Merger of individual and SHOP Exchanges—** A [State](/usc/42/18024.md?p=d) may elect to provide only one Exchange in the [State](/usc/42/18024.md?p=d) for providing both Exchange and SHOP Exchange services to both qualified individuals and qualified [small employers](/usc/42/18024.md?p=b-2), but only if the Exchange has adequate resources to assist such individuals and employers.
- (c) **Responsibilities of the Secretary—**
  - (1) **In general—** The [Secretary](/usc/42/18024.md?p=c) shall, by regulation, establish criteria for the certification of [health plans](/usc/42/18021.md?p=b-1-A) as [qualified health plans](/usc/42/18021.md?p=a-1). Such criteria shall require that, to be certified, a plan shall, at a minimum—
    - (A) meet marketing requirements, and not employ marketing [practices](/usc/42/17061.md?p=19) or benefit designs that have the effect of discouraging the enrollment in such plan by individuals with significant health needs;
    - (B) ensure a sufficient choice of providers (in a manner consistent with applicable network adequacy provisions under section 2702(c) of the Public Health Service Act [[42 U.S.C. 300gg–1(c)](/usc/42/300gg–1.md?p=c)]), and provide information to enrollees and prospective enrollees on the availability of in-network and out-of-network providers;
    - (C) include within health insurance plan networks those essential community providers, where available, that serve predominately low-income, medically-underserved individuals, such as health care providers defined in section 340B(a)(4) of the Public Health Service Act [[42 U.S.C. 256b(a)(4)](/usc/42/256b.md?p=a-4)] and providers described in section 1927(c)(1)(D)(i)(IV) of the Social Security Act [[42 U.S.C. 1396r–8(c)(1)(D)(i)(IV)](/usc/42/1396r–8.md?p=c-1-D-i-IV)] as set forth by section 221 of Public Law 111–8, except that nothing in this subparagraph shall be construed to require any [health plan](/usc/42/18021.md?p=b-1-A) to provide coverage for any specific medical procedure;
    - (D)
      - (i) be accredited with respect to local performance on clinical quality measures such as the Healthcare Effectiveness Data and Information Set, patient experience ratings on a standardized Consumer Assessment of Healthcare Providers and Systems survey, as well as consumer access, utilization management, quality assurance, provider credentialing, complaints and appeals, network adequacy and access, and patient information programs by any entity recognized by the [Secretary](/usc/42/18024.md?p=c) for the accreditation of [health insurance issuers](/usc/42/18021.md?p=b-2) or plans (so long as any such entity has transparent and rigorous methodological and scoring criteria); or
      - (ii) receive such accreditation within a period established by an Exchange for such accreditation that is applicable to all [qualified health plans](/usc/42/18021.md?p=a-1);
    - (E) implement a quality improvement strategy described in [subsection (g)(1)](#g-1);
    - (F) utilize a uniform enrollment form that qualified individuals and qualified employers may use (either electronically or on paper) in enrolling in [qualified health plans](/usc/42/18021.md?p=a-1) offered through such Exchange, and that takes into account criteria that the National Association of Insurance Commissioners develops and submits to the [Secretary](/usc/42/18024.md?p=c);
    - (G) utilize the standard format established for presenting health benefits plan options;
    - (H) provide information to enrollees and prospective enrollees, and to each Exchange in which the plan is offered, on any quality measures for [health plan](/usc/42/18021.md?p=b-1-A) performance endorsed under section 399JJ of the Public Health Service Act [[42 U.S.C. 280j–2](/usc/42/280j–2.md)], as applicable; and
    - (I) report to the [Secretary](/usc/42/18024.md?p=c) at least annually and in such manner as the [Secretary](/usc/42/18024.md?p=c) shall require, pediatric quality reporting measures consistent with the pediatric quality reporting measures established under section 1139A of the Social Security Act [[42 U.S.C. 1320b–9a](/usc/42/1320b–9a.md)].
  - (2) **Rule of construction—** Nothing in [paragraph (1)(C)](#c-1-C) shall be construed to require a [qualified health plan](/usc/42/18021.md?p=a-1) to contract with a provider described in such paragraph if such provider refuses to accept the generally applicable payment rates of such plan.
  - (3) **Rating system—** The [Secretary](/usc/42/18024.md?p=c) shall develop a rating system that would rate [qualified health plans](/usc/42/18021.md?p=a-1) offered through an Exchange in each benefits level on the basis of the relative quality and price. The Exchange shall include the quality rating in the information provided to individuals and employers through the Internet portal established under [paragraph (4)](#c-4).
  - (4) **Enrollee satisfaction system—** The [Secretary](/usc/42/18024.md?p=c) shall develop an enrollee satisfaction survey system that would evaluate the level of enrollee satisfaction with [qualified health plans](/usc/42/18021.md?p=a-1) offered through an Exchange, for each such [qualified health plan](/usc/42/18021.md?p=a-1) that had more than 500 enrollees in the previous year. The Exchange shall include enrollee satisfaction information in the information provided to individuals and employers through the Internet portal established under [paragraph (5)](#c-5) in a manner that allows individuals to easily compare enrollee satisfaction levels between comparable plans.
  - (5) **Internet portals—** The [Secretary](/usc/42/18024.md?p=c) shall—
    - (A) continue to operate, maintain, and update the Internet portal developed under [section 18003(a) of this title](/usc/42/18003.md?p=a) and to assist [States](/usc/42/18024.md?p=d) in developing and maintaining their own such portal; and
    - (B) make available for use by Exchanges a model template for an Internet portal that may be used to direct qualified individuals and qualified employers to [qualified health plans](/usc/42/18021.md?p=a-1), to assist such individuals and employers in determining whether they are eligible to participate in an Exchange or eligible for a premium tax credit or cost-sharing reduction, and to present standardized information (including quality ratings) regarding [qualified health plans](/usc/42/18021.md?p=a-1) offered through an Exchange to assist consumers in making easy health insurance choices.

    Such template shall include, with respect to each [qualified health plan](/usc/42/18021.md?p=a-1) offered through the Exchange in each rating area, access to the uniform outline of coverage the plan is required to provide under section 2716[^1] of the Public Health Service Act and to a copy of the plan’s written policy.

  - (6) **Enrollment periods—** The [Secretary](/usc/42/18024.md?p=c) shall require an Exchange to provide for—
    - (A) an initial open enrollment, as determined by the [Secretary](/usc/42/18024.md?p=c) (such determination to be made not later than July 1, 2012);
    - (B) annual open enrollment periods, as determined by the [Secretary](/usc/42/18024.md?p=c) for calendar years after the initial enrollment period;
    - (C) special enrollment periods specified in [section 9801 of title 26](/usc/26/9801.md) and other special enrollment periods under circumstances similar to such periods under part D of title XVIII of the Social Security Act [[42 U.S.C. 1395w–101](/usc/42/1395w–101.md) et seq.]; and
    - (D) special monthly enrollment periods for Indians (as defined in [section 1603 of title 25](/usc/25/1603.md)).
  - (7) **Reenrollment of certain individuals in qualified health plans in certain exchanges—**
    - (A) **In general—** In the case of an Exchange that the [Secretary](/usc/42/18024.md?p=c) operates pursuant to [section 18041(c)(1) of this title](/usc/42/18041.md?p=c-1), the [Secretary](/usc/42/18024.md?p=c) shall establish a process under which an individual described in [subparagraph (B)](#c-7-B) is reenrolled for plan year 2021 in a [qualified health plan](/usc/42/18021.md?p=a-1) offered through such Exchange. Such [qualified health plan](/usc/42/18021.md?p=a-1) under which such individual is so reenrolled shall be—
      - (i) if available for plan year 2021, the [qualified health plan](/usc/42/18021.md?p=a-1) under which such individual is enrolled during the annual open enrollment period for such plan year; and
      - (ii) if such [qualified health plan](/usc/42/18021.md?p=a-1) is not available for plan year 2021, a [qualified health plan](/usc/42/18021.md?p=a-1) offered through such Exchange determined appropriate by the [Secretary](/usc/42/18024.md?p=c).
    - (B) **Individual described—** An individual described in this subsection is an individual who, with respect to plan year 2020—
      - (i) resides in a [State](/usc/42/18024.md?p=d) with an Exchange described in [subparagraph (A)](#c-7-A);
      - (ii) is enrolled in a [qualified health plan](/usc/42/18021.md?p=a-1) during such plan year and does not enroll in a [qualified health plan](/usc/42/18021.md?p=a-1) for plan year 2021 during the annual open enrollment period for such plan year 2021; and
      - (iii) does not elect to disenroll under a [qualified health plan](/usc/42/18021.md?p=a-1) for plan year 2021 during such annual open enrollment period.
- (d) **Requirements—**
  - (1) **In general—** An Exchange shall be a governmental [agency](/usc/42/8262.md?p=1) or [nonprofit](/usc/42/300s–3.md?p=3) entity that is established by a [State](/usc/42/18024.md?p=d).
  - (2) **Offering of coverage—**
    - (A) **In general—** An Exchange shall make available [qualified health plans](/usc/42/18021.md?p=a-1) to qualified individuals and qualified employers.
    - (B) **Limitation—**
      - (i) **In general—** An Exchange may not make available any [health plan](/usc/42/18021.md?p=b-1-A) that is not a [qualified health plan](/usc/42/18021.md?p=a-1).
      - (ii) **Offering of stand-alone dental benefits—** Each Exchange within a [State](/usc/42/18024.md?p=d) shall allow an issuer of a plan that only provides limited scope dental benefits meeting the requirements of [section 9832(c)(2)(A) of title 26](/usc/26/9832.md?p=c-2-A) to offer the plan through the Exchange (either separately or in conjunction with a [qualified health plan](/usc/42/18021.md?p=a-1)) if the plan provides pediatric dental benefits meeting the requirements of [section 18022(b)(1)(J) of this title](/usc/42/18022.md?p=b-1-J)).
  - (3) **Rules relating to additional required benefits—**
    - (A) **In general—** Except as provided in [subparagraph (B)](#d-3-B), an Exchange may make available a [qualified health plan](/usc/42/18021.md?p=a-1) notwithstanding any provision of law that may require benefits other than the essential health benefits specified under [section 18022(b) of this title](/usc/42/18022.md?p=b).
    - (B) **States may require additional benefits—**
      - (i) **In general—** Subject to the requirements of [clause (ii)](#d-3-B-ii), a [State](/usc/42/18024.md?p=d) may require that a [qualified health plan](/usc/42/18021.md?p=a-1) offered in such [State](/usc/42/18024.md?p=d) offer benefits in addition to the essential health benefits specified under [section 18022(b) of this title](/usc/42/18022.md?p=b).
      - (ii) **State must assume cost—** A [State](/usc/42/18024.md?p=d) shall make payments—
        - (I) to an individual enrolled in a [qualified health plan](/usc/42/18021.md?p=a-1) offered in such [State](/usc/42/18024.md?p=d); or
        - (II) on behalf of an individual described in [subclause (I)](#d-3-B-ii-I) directly to the [qualified health plan](/usc/42/18021.md?p=a-1) in which such individual is enrolled;

      to defray the cost of any additional benefits described in [clause (i)](#d-3-B-i).

  - (4) **Functions—** An Exchange shall, at a minimum—
    - (A) implement procedures for the certification, recertification, and decertification, consistent with guidelines developed by the [Secretary](/usc/42/18024.md?p=c) under [subsection (c)](#c), of [health plans](/usc/42/18021.md?p=b-1-A) as [qualified health plans](/usc/42/18021.md?p=a-1);
    - (B) provide for the operation of a toll-free telephone hotline to respond to requests for assistance;
    - (C) maintain an Internet website through which enrollees and prospective enrollees of [qualified health plans](/usc/42/18021.md?p=a-1) may obtain standardized comparative information on such plans;
    - (D) assign a rating to each [qualified health plan](/usc/42/18021.md?p=a-1) offered through such Exchange in accordance with the criteria developed by the [Secretary](/usc/42/18024.md?p=c) under [subsection (c)(3)](#c-3);
    - (E) utilize a standardized format for presenting health benefits plan options in the Exchange, including the use of the uniform outline of coverage established under section 2715 of the Public Health Service Act [[42 U.S.C. 300gg–15](/usc/42/300gg–15.md)];
    - (F) in accordance with [section 18083 of this title](/usc/42/18083.md), inform individuals of eligibility requirements for the medicaid program under title XIX of the Social Security Act [[42 U.S.C. 1396](/usc/42/1396.md) et seq.], the CHIP program under title XXI of such Act [[42 U.S.C. 1397aa](/usc/42/1397aa.md) et seq.], or any applicable [State](/usc/42/18024.md?p=d) or local public program and if through screening of the application by the Exchange, the Exchange determines that such individuals are eligible for any such program, enroll such individuals in such program;
    - (G) establish and make available by electronic means a calculator to determine the actual cost of coverage after the application of any premium tax credit under [section 36B of title 26](/usc/26/36B.md) and any cost-sharing reduction under [section 18071 of this title](/usc/42/18071.md);
    - (H) subject to [section 18081 of this title](/usc/42/18081.md), grant a certification attesting that, for purposes of the individual responsibility penalty under [section 5000A of title 26](/usc/26/5000A.md), an individual is exempt from the individual requirement or from the penalty imposed by such section because—
      - (i) there is no affordable [qualified health plan](/usc/42/18021.md?p=a-1) available through the Exchange, or the individual’s employer, covering the individual; or
      - (ii) the individual meets the requirements for any other such exemption from the individual responsibility requirement or penalty;
    - (I) transfer to the [Secretary](/usc/42/18024.md?p=c) of the Treasury—
      - (i) a list of the individuals who are issued a certification under [subparagraph (H)](#d-4-H), including the name and taxpayer identification number of each individual;
      - (ii) the name and taxpayer identification number of each individual who was an employee of an employer but who was determined to be eligible for the premium tax credit under [section 36B of title 26](/usc/26/36B.md) because—
        - (I) the employer did not provide minimum essential coverage; or
        - (II) the employer provided such minimum essential coverage but it was determined under section 36B(c)(2)(C) of such title to either be unaffordable to the employee or not provide the required minimum actuarial value; and
      - (iii) the name and taxpayer identification number of each individual who notifies the Exchange under [section 18081(b)(4) of this title](/usc/42/18081.md?p=b-4) that they have changed employers and of each individual who ceases coverage under a [qualified health plan](/usc/42/18021.md?p=a-1) during a plan year (and the effective date of such cessation);
    - (J) provide to each employer the name of each employee of the employer described in [subparagraph (I)(ii)](#d-4-I-ii) who ceases coverage under a [qualified health plan](/usc/42/18021.md?p=a-1) during a plan year (and the effective date of such cessation); and
    - (K) establish the Navigator program described in [subsection (i)](#i).
  - (5) **Funding limitations—**
    - (A) **No Federal funds for continued operations—** In establishing an Exchange under this section, the [State](/usc/42/18024.md?p=d) shall ensure that such Exchange is self-sustaining beginning on January 1, 2015, including allowing the Exchange to charge assessments or user fees to participating [health insurance issuers](/usc/42/18021.md?p=b-2), or to otherwise [generate](/usc/42/2021b.md?p=8) funding, to support its operations.
    - (B) **Prohibiting wasteful use of funds—** In carrying out activities under this subsection, an Exchange shall not utilize any funds intended for the administrative and operational expenses of the Exchange for staff retreats, promotional giveaways, excessive executive compensation, or promotion of Federal or [State](/usc/42/18024.md?p=d) legislative and regulatory modifications.
  - (6) **Consultation—** An Exchange shall consult with stakeholders relevant to carrying out the activities under this section, including—
    - (A) [educated health care consumers](/usc/42/18024.md?p=e) who are enrollees in [qualified health plans](/usc/42/18021.md?p=a-1);
    - (B) individuals and entities with experience in facilitating enrollment in [qualified health plans](/usc/42/18021.md?p=a-1);
    - (C) representatives of small businesses and self-employed individuals;
    - (D) [State](/usc/42/18024.md?p=d) Medicaid offices; and
    - (E) advocates for enrolling hard to reach populations.
  - (7) **Publication of costs—** An Exchange shall publish the average costs of licensing, regulatory fees, and any other payments required by the Exchange, and the administrative costs of such Exchange, on an Internet website to educate consumers on such costs. Such information shall also include monies lost to waste, fraud, and abuse.
- (e) **Certification—**
  - (1) **In general—** An Exchange may certify a [health plan](/usc/42/18021.md?p=b-1-A) as a [qualified health plan](/usc/42/18021.md?p=a-1) if—
    - (A) such [health plan](/usc/42/18021.md?p=b-1-A) meets the requirements for certification as promulgated by the [Secretary](/usc/42/18024.md?p=c) under [subsection (c)(1)](#c-1); and
    - (B) the Exchange determines that making available such [health plan](/usc/42/18021.md?p=b-1-A) through such Exchange is in the interests of qualified individuals and qualified employers in the [State](/usc/42/18024.md?p=d) or [States](/usc/42/18024.md?p=d) in which such Exchange operates, except that the Exchange may not exclude a [health plan](/usc/42/18021.md?p=b-1-A)—
      - (i) on the basis that such plan is a fee-for-service plan;
      - (ii) through the imposition of premium price controls; or
      - (iii) on the basis that the plan provides [treatments](/usc/42/11851.md?p=11) necessary to prevent patients’ deaths in circumstances the Exchange determines are inappropriate or too costly.
  - (2) **Premium considerations—** The Exchange shall require [health plans](/usc/42/18021.md?p=b-1-A) seeking certification as [qualified health plans](/usc/42/18021.md?p=a-1) to submit a justification for any premium increase prior to implementation of the increase. Such plans shall prominently post such information on their websites. The Exchange shall take this information, and the information and the recommendations provided to the Exchange by the [State](/usc/42/18024.md?p=d) under section 2794(b)(1) of the Public Health Service Act [[42 U.S.C. 300gg–94(b)(1)](/usc/42/300gg–94.md?p=b-1)] (relating to patterns or [practices](/usc/42/17061.md?p=19) of excessive or unjustified premium increases), into consideration when determining whether to make such [health plan](/usc/42/18021.md?p=b-1-A) available through the Exchange. The Exchange shall take into account any excess of premium growth outside the Exchange as compared to the rate of such growth inside the Exchange, including information reported by the [States](/usc/42/18024.md?p=d).
  - (3) **Transparency in coverage—**
    - (A) **In general—** The Exchange shall require [health plans](/usc/42/18021.md?p=b-1-A) seeking certification as [qualified health plans](/usc/42/18021.md?p=a-1) to submit to the Exchange, the [Secretary](/usc/42/18024.md?p=c), the [State](/usc/42/18024.md?p=d) insurance commissioner, and make available to the public, accurate and timely disclosure of the following information:
      - (i) Claims payment policies and [practices](/usc/42/17061.md?p=19).
      - (ii) Periodic financial disclosures.
      - (iii) Data on enrollment.
      - (iv) Data on disenrollment.
      - (v) Data on the number of claims that are denied.
      - (vi) Data on rating [practices](/usc/42/17061.md?p=19).
      - (vii) Information on cost-sharing and payments with respect to any out-of-network coverage.
      - (viii) Information on enrollee and participant rights under this title.[^1]
      - (ix) Other information as determined appropriate by the [Secretary](/usc/42/18024.md?p=c).
    - (B) **Use of plain language—** The information required to be submitted under [subparagraph (A)](#e-3-A) shall be provided in plain language. The term “plain language” means language that the intended audience, including individuals with limited English proficiency, can readily understand and use because that language is concise, well-organized, and follows other best [practices](/usc/42/17061.md?p=19) of plain language writing. The [Secretary](/usc/42/18024.md?p=c) and the [Secretary](/usc/42/18024.md?p=c) of Labor shall jointly develop and issue guidance on best [practices](/usc/42/17061.md?p=19) of plain language writing.
    - (C) **Cost sharing transparency—** The Exchange shall require [health plans](/usc/42/18021.md?p=b-1-A) seeking certification as [qualified health plans](/usc/42/18021.md?p=a-1) to permit individuals to learn the amount of cost-sharing (including deductibles, copayments, and coinsurance) under the individual’s plan or coverage that the individual would be responsible for paying with respect to the furnishing of a specific item or service by a participating provider in a timely manner upon the request of the individual. At a minimum, such information shall be made available to such individual through an Internet website and such other means for individuals without access to the Internet.
    - (D) **Group health plans—** The [Secretary](/usc/42/18024.md?p=c) of Labor shall update and harmonize the [Secretary](/usc/42/18024.md?p=c)’s rules concerning the accurate and timely disclosure to participants by [group health plans](/usc/42/18021.md?p=b-3) of plan disclosure, plan terms and conditions, and periodic financial disclosure with the standards established by the [Secretary](/usc/42/18024.md?p=c) under [subparagraph (A)](#e-3-A).
- (f) **Flexibility—**
  - (1) **Regional or other interstate exchanges—** An Exchange may operate in more than one [State](/usc/42/18024.md?p=d) if—
    - (A) each [State](/usc/42/18024.md?p=d) in which such Exchange operates permits such operation; and
    - (B) the [Secretary](/usc/42/18024.md?p=c) approves such regional or interstate Exchange.
  - (2) **Subsidiary Exchanges—** A [State](/usc/42/18024.md?p=d) may establish one or more subsidiary Exchanges if—
    - (A) each such Exchange serves a geographically distinct area; and
    - (B) the area served by each such Exchange is at least as large as a rating area described in section 2701(a) of the Public Health Service Act [[42 U.S.C. 300gg(a)](/usc/42/300gg.md?p=a)].
  - (3) **Authority to contract—**
    - (A) **In general—** A [State](/usc/42/18024.md?p=d) may elect to authorize an Exchange established by the [State](/usc/42/18024.md?p=d) under this section to enter into an agreement with an eligible entity to carry out 1 or more responsibilities of the Exchange.
    - (B) **Eligible entity—** In this paragraph, the term “eligible entity” means—
      - (i) a person—
        - (I) incorporated under, and subject to the laws of, 1 or more [States](/usc/42/18024.md?p=d);
        - (II) that has demonstrated experience on a [State](/usc/42/18024.md?p=d) or regional basis in the individual and small group health insurance markets and in benefits coverage; and
        - (III) that is not a [health insurance issuer](/usc/42/18021.md?p=b-2) or that is treated under subsection (a) or (b) of [section 52 of title 26](/usc/26/52.md) as a member of the same controlled group of [corporations](/usc/42/2297h.md?p=2) (or under common control with) as a [health insurance issuer](/usc/42/18021.md?p=b-2); or
      - (ii) the [State](/usc/42/18024.md?p=d) medicaid [agency](/usc/42/8262.md?p=1) under title XIX of the Social Security Act [[42 U.S.C. 1396](/usc/42/1396.md) et seq.].
- (g) **Rewarding quality through market-based incentives—**
  - (1) **Strategy described—** A strategy described in this paragraph is a payment structure that provides increased reimbursement or other incentives for—
    - (A) improving health outcomes through the implementation of activities that shall include quality reporting, effective case management, care coordination, chronic disease management, medication and care compliance initiatives, including through the use of the medical home model, for [treatment](/usc/42/11851.md?p=11) or services under the plan or coverage;
    - (B) the implementation of activities to prevent [hospital](/usc/42/300s–3.md?p=1) readmissions through a comprehensive program for [hospital](/usc/42/300s–3.md?p=1) discharge that includes patient-centered education and counseling, comprehensive discharge planning, and post discharge reinforcement by an appropriate health care professional;
    - (C) the implementation of activities to improve patient safety and reduce medical errors through the appropriate use of best clinical [practices](/usc/42/17061.md?p=19), evidence based medicine, and health information technology under the plan or coverage;
    - (D) the implementation of wellness and health promotion activities; and
    - (E) the implementation of activities to reduce health and health care disparities, including through the use of language services, community outreach, and cultural competency trainings.
  - (2) **Guidelines—** The [Secretary](/usc/42/18024.md?p=c), in consultation with experts in health care quality and stakeholders, shall develop guidelines concerning the matters described in [paragraph (1)](#g-1).
  - (3) **Requirements—** The guidelines developed under [paragraph (2)](#g-2) shall require the periodic reporting to the applicable Exchange of the activities that a [qualified health plan](/usc/42/18021.md?p=a-1) has conducted to implement a strategy described in [paragraph (1)](#g-1).
- (h) **Quality improvement—**
  - (1) **Enhancing patient safety—** Beginning on January 1, 2015, a [qualified health plan](/usc/42/18021.md?p=a-1) may contract with—
    - (A) a [hospital](/usc/42/300s–3.md?p=1) with greater than 50 beds only if such [hospital](/usc/42/300s–3.md?p=1)—
      - (i) utilizes a patient safety evaluation system as described in part C of title IX of the Public Health Service Act [[42 U.S.C. 299b–21](/usc/42/299b–21.md) et seq.]; and
      - (ii) implements a mechanism to ensure that each patient receives a comprehensive program for [hospital](/usc/42/300s–3.md?p=1) discharge that includes patient-centered education and counseling, comprehensive discharge planning, and post discharge reinforcement by an appropriate health care professional; or
    - (B) a health care provider only if such provider implements such mechanisms to improve health care quality as the [Secretary](/usc/42/18024.md?p=c) may by regulation require.
  - (2) **Exceptions—** The [Secretary](/usc/42/18024.md?p=c) may establish reasonable exceptions to the requirements described in [paragraph (1)](#h-1).
  - (3) **Adjustment—** The [Secretary](/usc/42/18024.md?p=c) may by regulation adjust the number of beds described in [paragraph (1)(A)](#h-1-A).
- (i) **Navigators—**
  - (1) **In general—** An Exchange shall establish a program under which it awards grants to entities described in [paragraph (2)](#i-2) to carry out the duties described in [paragraph (3)](#i-3).
  - (2) **Eligibility—**
    - (A) **In general—** To be eligible to receive a grant under [paragraph (1)](#i-1), an entity shall demonstrate to the Exchange involved that the entity has existing relationships, or could readily establish relationships, with employers and employees, consumers (including uninsured and underinsured consumers), or self-employed individuals likely to be qualified to enroll in a [qualified health plan](/usc/42/18021.md?p=a-1).
    - (B) **Types—** Entities described in [subparagraph (A)](#i-2-A) may include trade, industry, and professional associations, commercial fishing industry organizations, ranching and farming organizations, community and consumer-focused [nonprofit](/usc/42/300s–3.md?p=3) groups, chambers of commerce, unions, resource partners of the Small Business Administration, other licensed insurance agents and brokers, and other entities that—
      - (i) are capable of carrying out the duties described in [paragraph (3)](#i-3);
      - (ii) meet the standards described in [paragraph (4)](#i-4); and
      - (iii) provide information consistent with the standards developed under [paragraph (5)](#i-5).
  - (3) **Duties—** An entity that serves as a navigator under a grant under this subsection shall—
    - (A) conduct public education activities to raise awareness of the availability of [qualified health plans](/usc/42/18021.md?p=a-1);
    - (B) distribute fair and impartial information concerning enrollment in [qualified health plans](/usc/42/18021.md?p=a-1), and the availability of premium tax credits under [section 36B of title 26](/usc/26/36B.md) and cost-sharing reductions under [section 18071 of this title](/usc/42/18071.md);
    - (C) facilitate enrollment in [qualified health plans](/usc/42/18021.md?p=a-1);
    - (D) provide referrals to any applicable office of health insurance consumer assistance or health insurance ombudsman established under section 2793 of the Public Health Service Act [[42 U.S.C. 300gg–93](/usc/42/300gg–93.md)], or any other appropriate [State agency](/usc/42/300s–3.md?p=12) or [agencies](/usc/42/8262.md?p=1), for any enrollee with a grievance, complaint, or question regarding their [health plan](/usc/42/18021.md?p=b-1-A), coverage, or a determination under such plan or coverage; and
    - (E) provide information in a manner that is culturally and linguistically appropriate to the needs of the population being served by the Exchange or Exchanges.
  - (4) **Standards—**
    - (A) **In general—** The [Secretary](/usc/42/18024.md?p=c) shall establish standards for navigators under this subsection, including provisions to ensure that any private or public entity that is selected as a navigator is qualified, and licensed if appropriate, to engage in the navigator activities described in this subsection and to avoid conflicts of interest. Under such standards, a navigator shall not—
      - (i) be a [health insurance issuer](/usc/42/18021.md?p=b-2); or
      - (ii) receive any consideration directly or indirectly from any [health insurance issuer](/usc/42/18021.md?p=b-2) in connection with the enrollment of any qualified individuals or employees of a qualified employer in a [qualified health plan](/usc/42/18021.md?p=a-1).
  - (5) **Fair and impartial information and services—** The [Secretary](/usc/42/18024.md?p=c), in collaboration with [States](/usc/42/18024.md?p=d), shall develop standards to ensure that information made available by navigators is fair, accurate, and impartial.
  - (6) **Funding—** Grants under this subsection shall be made from the operational funds of the Exchange and not Federal funds received by the [State](/usc/42/18024.md?p=d) to establish the Exchange.
- (j) **Applicability of mental health parity—** Section 2726 of the Public Health Service Act [[42 U.S.C. 300gg–26](/usc/42/300gg–26.md)] shall apply to [qualified health plans](/usc/42/18021.md?p=a-1) in the same manner and to the same extent as such section applies to [health insurance issuers](/usc/42/18021.md?p=b-2) and [group health plans](/usc/42/18021.md?p=b-3).
- (k) **Conflict—** An Exchange may not establish rules that conflict with or prevent the application of regulations promulgated by the [Secretary](/usc/42/18024.md?p=c) under this subchapter.

## Footnotes

[^1]: See References in Text note below.

## Source credit

(Pub. L. 111–148, title I, § 1311, title X, §§ 10104(e)–(h), 10203(a), Mar. 23, 2010, 124 Stat. 173, 900, 901, 927; Pub. L. 116–94, div. N, title I, § 608, Dec. 20, 2019, 133 Stat. 3130.)

## Notes

### Editorial Notes

### References in Text

Subtitles A and C, referred to in subsec. (a)(4)(A)(i)(II), are subtitles A (§§ 1001–1004) and C (§§ 1201–1255), respectively, of title I of Pub. L. 111–148, Mar. 23, 2010, 124 Stat. 130, 154. Subtitle A enacted sections 300gg–11 to 300gg–19, 300gg–93, and 300gg–94 of this title, transferred sections 300gg–4 to 300gg–7 and 300gg–13 of this title to sections 300gg–25 to 300gg–28 and 300gg–9 of this title, respectively, amended sections 300gg–11, 300gg–12, and 300gg–21 to 300gg–23 of this title, and enacted provisions set out as a note under section 300gg–11 of this title. Subtitle C enacted subchapter II of this chapter and sections 300gg to 300gg–2 and 300gg–4 to 300gg–7 of this title, transferred section 300gg of this title to section 300gg–3 of this title, amended sections 300gg–1 and 300gg–4 of this title, and enacted provisions set out as a note under section 300gg of this title. For complete classification of subtitles A and C to the Code, see Tables.

This title, referred to in subsecs. (b)(1) and (e)(3)(A)(viii), is title I of Pub. L. 111–148, Mar. 23, 2010, 124 Stat. 130, which enacted this chapter and enacted, amended, and transferred numerous other sections and notes in the Code. For complete classification of title I to the Code, see Tables.

Section 2716 of the Public Health Service Act, referred to in subsec. (c)(5), probably should be section 2715 of the Public Health Service Act, act July 1, 1944, which is classified to section 300gg–15 of this title and requires the Secretary to develop a uniform explanation of coverage documents and standardized definitions. Section 2716 of act July 1, 1944, which is classified to section 300gg–16 of this title, relates to prohibition on discrimination in favor of highly compensated individuals.

The Social Security Act, referred to in subsecs. (c)(6)(C), (d)(4)(F), and (f)(3)(B)(ii), is act Aug. 14, 1935, ch. 531, 49 Stat. 620. Part D of title XVIII of the Act is classified generally to part D (§ 1395w–101 et seq.) of subchapter XVIII of chapter 7 of this title. Titles XIX and XXI of the Act are classified generally to subchapters XIX (§ 1396 et seq.) and XXI (§ 1397aa et seq.), respectively, of chapter 7 of this title. For complete classification of this Act to the Code, see section 1305 of this title and Tables.

The Public Health Service Act, referred to in subsec. (h)(1)(A)(i), is act July 1, 1944, ch. 373, 58 Stat. 682. Part C of title IX of the Act is classified generally to part C (§ 299b–21 et seq.) of subchapter VII of chapter 6A of this title. For complete classification of this Act to the Code, see Short Title note set out under section 201 of this title and Tables.

This subchapter, referred to in subsec. (k), was in the original “this subtitle”, meaning subtitle D of title I of Pub. L. 111–148, Mar. 23, 2010, 124 Stat. 162, which enacted this subchapter and amended sections 501, 4958, and 6033 of Title 26, Internal Revenue Code.

### Amendments

2019—Subsec. (c)(7). Pub. L. 116–94 added par. (7).

2010—Subsec. (c)(1)(I). Pub. L. 111–148, § 10203(a), added subpar. (I).

Subsec. (d)(3)(B)(ii). Pub. L. 111–148, § 10104(e)(1), added cl. (ii) and struck out former cl. (ii). Prior to amendment, text read as follows: “A State shall make payments to or on behalf of an individual eligible for the premium tax credit under section 36B of title 26 and any cost-sharing reduction under section 18071 of this title to defray the cost to the individual of any additional benefits described in clause (i) which are not eligible for such credit or reduction under section 36B(b)(3)(D) of title 26 and section 18071(c)(4) of this title.”

Subsec. (d)(6)(A). Pub. L. 111–148, § 10104(e)(2), inserted “educated” before “health care”.

Subsec. (e)(2). Pub. L. 111–148, § 10104(f)(1), which directed substitution of “shall” for “may” in second sentence, was executed by making the substitution in third sentence before “take” to reflect the probable intent of Congress because the word “shall” already appeared in second sentence.

Subsec. (e)(3). Pub. L. 111–148, § 10104(f)(2), added par. (3).

Subsec. (g)(1)(E). Pub. L. 111–148, § 10104(g), added subpar. (E).

Subsec. (i)(2)(B). Pub. L. 111–148, § 10104(h), substituted “resource partners of the Small Business Administration” for “small business development centers”.

### Statutory Notes and Related Subsidiaries

### Establishing a Grant Program for Exchange Modernization

Pub. L. 117–2, title II, § 2801, Mar. 11, 2021, 135 Stat. 49, provided that: In General.—Out of funds appropriated under subsection (b), the Secretary of Health and Human Services (in this subtitle [subtitle I (§ 2801) of title II of Pub. L. 117–2] referred to as the ‘Secretary’) shall award grants to each American Health Benefits Exchange established under section 1311(b) of the Patient Protection and Affordable Care Act (42 U.S.C. 18031(b)) (other than an Exchange established by the Secretary under section 1321(c) of such Act (42 U.S.C. 18041(c))) that submits to the Secretary an application at such time and in such manner, and containing such information, as specified by the Secretary, for purposes of enabling such Exchange to modernize or update any system, program, or technology utilized by such Exchange to ensure such Exchange is compliant with all applicable requirements. Funding.—In addition to amounts otherwise available, there is appropriated, for fiscal year 2021, out of any money in the Treasury not otherwise appropriated, $20,000,000, to remain available until September 30, 2022, for carrying out this section.”